Full Text of HB1784 095th General Assembly
HB1784eng 95TH GENERAL ASSEMBLY
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| AN ACT concerning education.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The School Code is amended by changing Section | 5 |
| 1A-8 as follows:
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| (105 ILCS 5/1A-8) (from Ch. 122, par. 1A-8)
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| Sec. 1A-8. Powers of the Board in Assisting Districts | 8 |
| Deemed in Financial
Difficulties. To promote the financial | 9 |
| integrity of school districts, the
State Board of Education | 10 |
| shall be provided the necessary powers to promote
sound | 11 |
| financial management and continue operation of the public | 12 |
| schools.
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| The State Superintendent of Education may require a school | 14 |
| district, including any district subject to Article 34A of this | 15 |
| Code, to share financial information relevant to a proper | 16 |
| investigation of the district's financial condition and the | 17 |
| delivery of appropriate State financial, technical, and | 18 |
| consulting services to the district if the district (i) has | 19 |
| been designated, through the State Board of Education's School | 20 |
| District Financial Profile System, as on financial warning or | 21 |
| financial watch status, (ii) has failed to file an annual | 22 |
| financial report, annual budget, deficit reduction plan, or | 23 |
| other financial information as required by law, or (iii) has |
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| been identified, through the district's annual audit or other | 2 |
| financial and management information, as in serious financial | 3 |
| difficulty in the current or next school year. In addition to | 4 |
| financial, technical, and consulting services provided by the | 5 |
| State Board of Education, at the request of a school district, | 6 |
| the State Superintendent may provide for an independent | 7 |
| financial consultant to assist the district review its | 8 |
| financial condition and options.
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| The State Board of Education, after proper investigation of | 10 |
| a district's
financial condition, may certify that a district, | 11 |
| including any district
subject to Article 34A, is in financial | 12 |
| difficulty
when any of the following conditions occur:
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| (1) The district has issued school or teacher orders | 14 |
| for wages as permitted in Sections
8-16, 32-7.2 and 34-76 | 15 |
| of this Code;
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| (2) The district has issued tax anticipation warrants | 17 |
| or tax
anticipation notes in anticipation of a second | 18 |
| year's taxes when warrants or
notes in anticipation of | 19 |
| current year taxes are still outstanding, as
authorized by | 20 |
| Sections 17-16, 34-23, 34-59 and 34-63 of this Code, or has | 21 |
| issued short-term debt against 2 future revenue sources, | 22 |
| such as, but not limited to, tax anticipation warrants and | 23 |
| general State Aid certificates or tax anticipation | 24 |
| warrants and revenue anticipation notes;
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| (3) The district has for 2 consecutive years shown an | 26 |
| excess
of expenditures and other financing uses over |
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| revenues and other financing
sources and beginning fund | 2 |
| balances on its annual financial report for the
aggregate | 3 |
| totals of the Educational, Operations and Maintenance,
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| Transportation, and Working Cash Funds;
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| (4) The district refuses to provide financial | 6 |
| information or cooperate with the State Superintendent in | 7 |
| an investigation of the district's financial condition.
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| No school district shall be certified by the State Board of | 9 |
| Education to be in financial difficulty by
reason of any of the | 10 |
| above circumstances ; (i) arising as a result of the failure
of | 11 |
| the county to make any distribution of property tax money due | 12 |
| the district
at the time such distribution is due ; (ii) arising | 13 |
| as a result of the failure of the Comptroller to disburse | 14 |
| reimbursements authorized under Sections 14-7.03, 14-7.02, | 15 |
| 14-7.02b, 14-13.01, 18-3, 18-11, 18-4.3, and 29-5 for receipt | 16 |
| by the school district no later than June 30th of each year ; or | 17 |
| (iii) if the district clearly demonstrates
to the satisfaction | 18 |
| of the State Board of Education at the time of its
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| determination that such condition no longer exists. If the | 20 |
| State Board of
Education certifies that a district in a city | 21 |
| with 500,000 inhabitants or
more is in financial difficulty, | 22 |
| the State Board shall so notify the
Governor and the Mayor of | 23 |
| the city in which the district is located. The
State Board of | 24 |
| Education may require school districts certified in
financial | 25 |
| difficulty, except those districts subject to Article 34A, to
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| develop, adopt and submit a financial plan within 45 days after
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| certification of financial difficulty. The financial plan | 2 |
| shall be
developed according to guidelines presented to the | 3 |
| district by the State
Board of Education within 14 days of | 4 |
| certification. Such guidelines shall
address the specific | 5 |
| nature of each district's financial difficulties. Any
proposed | 6 |
| budget of the district shall be consistent with the financial | 7 |
| plan
submitted to and
approved by the State Board of Education.
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| A district certified to be in financial difficulty, other | 9 |
| than a district
subject to Article 34A, shall report to the | 10 |
| State Board of Education at
such times and in such manner as | 11 |
| the State Board may direct, concerning the
district's | 12 |
| compliance with each financial plan. The State Board may review
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| the district's operations, obtain budgetary data and financial | 14 |
| statements,
require the district to produce reports, and have | 15 |
| access to any other
information in the possession of the | 16 |
| district that it deems relevant. The
State Board may issue | 17 |
| recommendations or directives within its powers to
the district | 18 |
| to assist in compliance with the financial plan. The district
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| shall produce such budgetary data, financial statements, | 20 |
| reports and other
information and comply with such directives. | 21 |
| If the State Board of Education
determines that a district has | 22 |
| failed to comply with its financial plan, the
State Board of | 23 |
| Education may rescind approval of the plan and appoint a
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| Financial Oversight Panel for the district as provided in | 25 |
| Section 1B-4. This
action shall be taken only after the | 26 |
| district has been given notice and an
opportunity to appear |
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| before the State Board of Education to discuss its
failure to | 2 |
| comply with its financial plan.
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| No bonds, notes, teachers orders, tax anticipation | 4 |
| warrants or other
evidences of indebtedness shall be issued or | 5 |
| sold by a school district or
be legally binding upon or | 6 |
| enforceable against a local board of education
of a district | 7 |
| certified to be in financial difficulty unless and until the
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| financial plan required under this Section has been approved by | 9 |
| the State
Board of Education.
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| Any financial watch list distributed by the State Board of | 11 |
| Education
pursuant to this Section shall designate those school | 12 |
| districts on the
watch list that would not otherwise be on the | 13 |
| watch list were it not for the
inability or refusal of the | 14 |
| State of Illinois to make timely
disbursements of any payments | 15 |
| due school districts or to fully reimburse
school districts for | 16 |
| mandated categorical programs pursuant to
reimbursement | 17 |
| formulas provided in this School Code.
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| (Source: P.A. 94-234, eff. 7-1-06 .)
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| Section 99. Effective date. This Act takes effect July 1, | 20 |
| 2007.
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